Second Quarter Review and Outlook

What Just Happened? The U.S. equity market (S&P 500® Index) notched a gain of nearly 4% in the June quarter. Considering the challenges of the quarter, the market’s “good-but-not-great” Q2 June performance deserves respect. Those challenges included (1) higher-than-hoped inflation – still above the Federal Reserve’s 2% goal – and, thus, (2) no interest rate relief from the Fed. The bank’s base interest rate has been 5.25-5.50% for a full year. At the start of this year many economists predicted the Fed would cut rates four or five times in 2024. Now, most Fed watchers expect the bank to cut rates just once or twice in the second half, if even that.

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